Nigeria’s manufacturing sector expanded at a faster pace, with growth accelerating to 3.24 percent in Q2 2026 from 1.69 percent in the corresponding quarter of 2025, driven by renewed optimism.
Data from the National Bureau of Statistics shows that the sector’s real contribution to GDP in the second quarter was 7.72 percent, lower than the 7.81 percent recorded in the same period of 2025 and 9.57 percent recorded in the first quarter of 2026.
The pickup reflects better access to foreign exchange, increased confidence in government reforms, and expectations of lower borrowing costs have prompted firms to raise output and restock inventories.
The Manufacturers Association of Nigeria’s CEO Confidence Index rose to 52.1 from 48.7, its highest level in more than two years in the second quarter of 2026, signaling renewed optimism in the sector.
‘Specifically, within the second quarter of 2026, manufacturers reported a return of confidence in doing business in Nigeria,’ the MAN report said.
‘The recent tax laws, executive orders and other business-related policies, Nigeria Industrial Policy and ‘Nigeria First’ Policy cast a more positive outlook on manufacturing executives,’ the report added.
The Nigeria Industrial Policy was launched in the first quarter of 2026 and has recorded significant progress within its first 90 days of implementation, with achievements spanning financing, skills development, industrial infrastructure, exports and support for local manufacturing.
The Ministry of Trade and Investment says it has mobilised more than $380 million in strategic financing in the first 90 days of the policy and advanced plans for a proposed N350 billion MSME Development Fund.
The federal government had also introduced the Nigeria First policy to prioritize domestic industries and grow the economy.
Under the government’s Made-in-Nigeria agenda, the ministry said it has begun consultations with key stakeholders to strengthen the implementation of the Nigeria First Policy and boost patronage of locally manufactured goods.
These policies have increased manufacturers’ confidence in the economy in the second quarter.
Executives projected further improvement in Q3, with indices for business conditions at 55.6, employment at 55.2 and production at 63.
On a quarter-on-quarter basis, manufacturing growth dipped marginally, from 3.29 percent in the first quarter of 2026 to 2.24 percent in the second quarter of the year.
Manufacturers say the growth offers support for Africa’s largest economy as policymakers push to deepen industrialization and reduce dependence on imports.
While challenges including power supply and logistics remain, the faster expansion suggests manufacturing could contribute more to job creation and GDP growth in the coming quarters if confidence holds.
Muda Yusuf, chief executive officer at the Centre for the Promotion of Private Enterprise (CPPE), noted that given the continuing pressures from energy, finance and logistics costs, manufacturers remain resilient.
Within manufacturing, food, beverages and tobacco grew by 2.79 percent; electrical and electronics by 1.51 percent; and non-metallic products by 2.17 percent.
‘Although these rates moderated, they confirm that productive activity is still expanding and could respond strongly to a reduction in structural costs,’ Yusuf said.